People keep demanding they spend money on disaster relief and flood insurance. At a certain point it's better (cheaper) to demolish the houses in places that keep getting hit.
Yes, it'd probably be better if the government let people face the damages for the most part. Unfortunately it's consistently portrayed as a huge failing if, say, a president fails to respond to a hurricane quickly or decisively enough. Partly because of the usual partisan nonsense, but also because the local governments want the aid.
Think about who owns waterfront property, yacht clubs, etc. and ask whether those rich people are likely to be well-represented in the legislatures. Government agencies do what the law makers tell them and it’s really hard to roll back decades spent ignoring the problem for short-term profit, especially when there’s a large and effective propaganda machine which will attack anyone who suggests policies which realistically accept the scale of the problem.
The woman profiled in this Bloomberg piece is 60, likely is not wealthy (her insurance settlement is a bit more than half of what remains on her mortgage, and she cannot afford to bring her house up to code due to the extent of the damages), and could possibly be homeless without a relo buyout. If it was me, I’d buy a new home in Florida (far above sea level!) with my settlement, and default on the shack she’s stuck with (Florida law is very strong when it comes to protecting debtors; as long as her new home is her primary residence, all of her equity would be protected from creditors, as well as her social security when she begins to collect). But that’s not a solution that works at scale.
As long as the properties are bulldozed and never allowed to be developed again, it’s reasonable policy.
Should people know better? Perfect information is hard. I’ve bugged Redfin several times to include these models in their property search interface with no reply. You need legislation to better assist real estate buyers to fully understand what they’re getting into.
> Should people know better? Perfect information is hard.
Ordinary people aren't the perfect agents we're propagandized them to be. People often are forced to gamble tomorrow to live through today. I've seen people make the gamble and lose badly and others manage to slip out from under it.
I'm agreeing with you. The state zones places that aren't suitable for housing. Banks loan developers money to build. And quasi-government agencies hold loans used to buy the houses. In these clusterfucks the owner is just one of many partially responsible parties.
I remember reading about a disaster in Washington State (I think). A geology professor been doing field trips to an hill side. To show his students an example of an unstable hillside. One year he shows up and there are now houses on it. Few years after that the whole thing comes down.
Another one. During the housing bubble in California they build a subdivision on farmland that was reserved as a flood plain. During heavy rainfall years it's expected to flood. Now there are houses on it.
Are the people that bought those houses responsible or are they more victims? Both?
As long as it was disclosed to the buyer then they take the risk with hopefully flood insurance. If it wasn’t disclosed then they may have recourse against the property developer and their agent.
This would actually be closer to the realities in Miami, Ft. Lauderdale up to Palm Beach (Mara Lago), than the Keys. Most of the people in the Keys are not heavily politically active and have moved here to fall of the face of the earth or where born here. A decent amount of waterfront property is still family owned and used in family businesses such as shrimp, lobster or stone crab operations.
Funny enough, waterfront property in the keys is rather affordable when compared to other areas of Florida.
That’s a good point to expand on: I wasn’t thinking that everyone on every inch of the coast is rich but rather that those interests align. It’s usually politically risky to pass something which only benefits rich people than something which covers the entire state, which just happens to include that high-value property. When a relief or insurance measure is coming up, they’re just going to make sure it has no or generous limits and make sure that it goes through.
Similarly, tourism related businesses might not be plutocrat-level wealth but they tend to be well-represented politically because they’re visible and employ a fair number of people.
That isn't why the government intercedes in stuff like this. It intercedes because if it says "Welp. Not My Problem." and these folks say "Fuck it. Not Mine Either." and just walk away from their properties, declare bankruptcy, whatever, and become basically refugees within their own country, you have worse problems.
My sister had a break-in at her home one year. She told me something like "Well, the benefits for Katrina survivors ran out last week. That's probably not coincidental."
If you have people who, through no fault of their own, cannot make their lives work and the entire rest of the world takes the attitude "Well, too bad, so fucking sad, chump. Not Our Problem." then people have a tendency to say "Welp. The system doesn't work for me, so why should I care about little details like you expecting me to respect your property rights? It's not like you care about my inability to eat through no damn fault of my own."
When stuff like that happens on a broad scale, it leads to serious problems. Entire industries/cities/regions can be negatively impacted if enough people walk away from their problems and just go elsewhere.
If the government failed to hold corporations that emitted greenhouse gasses accountable for their externalities then I'd say that it becomes the government's responsibility.
Since corporations can pass changes in cost onto consumers by raising prices, if the government held corporations accountable for the costs of their externalities, then those costs would also be shared by the consumers.
I think that's only me in the sense that I am an employee, a consumer, and own stocks. Presumably if the government fined corporations for the damage they caused to the environment then I would be effected through those roles.
However, corporations are not me in the sense that I neither make the decisions nor receive the pay that corporate executives do.
* An oil company pumps oil out of the ground, and sells it to a petroleum company.
* The petroleum company refines that oil into gasoline.
* An auto company builds a truck that runs on gasoline
* A shipping company buys said truck, as well gasoline to power it.
* A store contracts that company to ship their goods.
When a consumer buys something from that store, and has a gasoline burning truck move the goods from the warehouse to their residence who was responsible for emitting those greenhouse gases?
This is discussed in a book called "The Geography of Risk"
"The chief beneficiaries of the land boom at the coast have been the beach towns and property owners who perversely shoulder little of the risk of building in harm’s way yet enjoy most of the wealth, the report added."
The biggest flood insurance beneficiary is the Houston TX area. "More flood insurance funds have been paid here than in any other National Flood Insurance Program-participating community."[1]
"After the 1940's, the Harris County area did not suffer what would be considered a widespread, regional flood, that is, until June 2001." Since then, 2001, 2006, 2008, 2009, 2015, 2016, and right now.
Houston way overbuilt in flood plains. That area has had floods for a century, but the impact was lower when the big losses were herds of cattle. They need higher flood insurance premiums to discourage building.
The Florida Keys, Greater Miami, New Orleans, and Houston are just too low-lying for today's hurricanes. New Orleans has everything going wrong - the Mississippi River, hurricane country, and sinking land.
Two trends which I am familiar with are the excess development of South Florida and Harris County.
Both driven because the county government is funded by taxes on property rather than commerce.
To achieve growth in the bureaucracy, taxes have increased as fast as possible, and additional property developed at a growing rate in order to increase its taxable value.
In Florida it's lots of building only slightly above sea level so there's risk from the beginning, in Texas as more of the watershed/flood plain is paved neighborhoods that were not at risk before have become underwater estates.
>They need higher flood insurance premiums to discourage building.
We already have that. Just results in more people becoming uninsurable. Regulation would probably be better, but county governments are incentivizing toward developers who can afford to work around this type of discouragement anyway, which is one of the cases where it pays more than regulation. Now that the damage has been done, the most pro-development Harris County Judge of all is no longer in power, but there's still residual momentum, and it's a little too late. You should have seen it this week.
Looks like some "Real Estate" systems have been selling you false estate since the beginning. After all you can not disprove that the purpose of county government is corruption.
I can only imagine what would happen if you got unscrupulous developers mixed up with government like this on a larger scale.
Two of these are not like the others - are the ports (I count Galveston and South Louisiana as part of their nearby bigger cities) just going to be allowed to vanish?
Depends on motivation and power structure I would think.
These are incredibly productive institutions and under normal operation can build enough resources to weather any storm, plus this kind of thing is what's mainly insured when a storm does hit.
In response to a gradual rise in sea level, they would be expected to adapt at a glacier's pace but anything is possible. For example the island of Galveston was largely raised 8 feet after the disaster of 1900 as the preferred approach to future mitigation, and that foresight turns out to be about as good as you can get so far when it comes to coping with unforseen sea level rise.
You just need to have foresight good enough to forsee the unforseen.
Eventually working in industrial environments like Galveston or Texas City will not be that much different than working offshore in the Gulf. Heck, some operators justify working offshore now because it's not much worse than working in a mainland oil field or refinery anyway.
Besides traditional businesses of Texas, in South Florida probably agriculture and real estate would suffer first, but I imagine tourism would hold out as long as it could and smuggling would not want to go anywhere either, with their multi-century tradition.
It's not even that. It's votes and party donations.
I'm in NJ. A few years back we had hurricane / super-storm Sandy. Not only did the GOP gov at the time ( Chris Christie) find the money to rebuild. The state actually ran adverts with the tag line "Stronger than the storm." It made no sense to me.
The people living at the shore (as we call it in NJ) aren't in denial. They don't even see it.
If you think people were just bailed out you're crazy. I have a neighbor whose multi million dollar beach house was completely destroyed. He got little to no help for his property. Sure, the infra was probably all govt money, but aside from some minimal insurance he was his own insurer.
Um. I said nothing about that. My point was, the gov pushed to rebuild - because it's good for votes / donations. And they even put a spin on it. There was zero discussion about perhaps not rebuilding. There should have been. It was obvious there should have been.
Government is buying her out because government is the cause of her problem.
Buried all the way at the bottom of the article is this little gem:
> Her insurance payout of about $100,000 would cover repairs to the 640-square-foot house. But the county requires that when more than 50% of a home is damaged, that it be completely rebuilt to meet modern storm-resiliency codes and — in her flood zone — on stilts. That would cost at least $200,000, money she doesn’t have.
So, effectively, she can rebuild her home in a way that would (presumptively) make her happy but government legislation forces her to spend double the money to rebuild it in way she probably isn't a fan of. Simple solution is to limit the ability of local building codes to force people to completely demolish/rebuild in situations like these. She had a non-elevated non-flood-proof home before, she should be able to keep her home the way she likes it at a cost she can afford, assuming the people financially invested (mortgage company, insurance company) agree, why shouldn't she be allowed?
Because it’s the right thing to do, costs a pittance in the grand scheme of things, and is the cheapest course of action compared to continuing to rebuild. The article begins with a woman who can’t afford to get out and just got running water for dishes for the first time in 2 years, these aren’t all people living high off the hog.
I'm assuming you are conveniently forgetting that the 'Social security', 'Medicare' and 'Other spending' slices of mandatory spending go to rich and poor: these programs pay out their benefits to all people regardless of how wealthy they are.
Not to mention that social security and medicare funding comes directly out of every paycheck I get. It's dishonest to claim those payments are people leeching off the rich when a huge % of the beneficiaries literally paid for them.
Considering the taxes scale with income and a low income person would, in no way, cover the costs, Medicare and to an extent Social Security are a wealth transfer to the poor.
"Wealth" transfers to the poor to keep people alive and in good health and help lift them out of poverty are great policy. We need a lot more of those, because there are too many poor people, and they are suffering. The US is the richest country on earth, and this situation is plain wrong.
In this particular case, though, any transfers are more 'chump change' than 'wealth' from the rich: Social Security tax is only levied on the first $132,900 of earned income (2019). With the exception of the surtax, Medicare taxes are only due on earned income. Rich people don't make the bulk of their money from a paycheck, so it really isn't like the rich are contributing a lot of their wealth or even income to the Medicare and Social Security systems.
On top of that, the rich still get all the benefits of the same Medicare and Social Security programs. So what if they pay in a bit more over a lifetime than their nanny or the schoolteacher of their children? These are insurance programs, and that is how insurance works: everyone pays in, and everyone benefits, but not necessarily to the same extent.
Because why should the current homeowner happen to be the one caught with a total loss, rather than another one in the previous 30 years or the next 30 years?
If the government is making it policy not to be able to live on land you purchased, then it should compensate you.
(The exception being if everyone who bought property had always known there was an e.g. 80% chance of the government taking it without payment and thus bought their property at e.g. 20% of what would otherwise be the market value... but that doesn't seem to be the case.)
The homeowners weren't forced to purchase these properties, so it's not the government's responsibility to remediate the situation.